The Deferred Sale System in Iraqi Law and Positive Laws

(A Comparative Study)

Abstract

This research examines the deferred sale system as a common form of contracting in civil and commercial transactions. One party—usually the buyer—is granted a period to fulfil their financial obligation, either by deferring payment in full or by paying it in instalments. The research addresses the regulation of this system in Iraqi Civil Law through the provisions of Articles 508, 513, and others, which permit deferring payment or dividing it into instalments, provided there is an explicit agreement between the two parties. The buyer is obligated to pay when the contract is due, and the seller has the right to cancel in the event of a serious breach.

The research also compares these provisions with those contained in a number of positive laws, such as Egyptian and Saudi law, highlighting similarities in respecting the principle of the sovereignty of the will in determining the term, and differences in some details, such as protecting the seller in cases of cancellation or exempting him from the warranty in the event of a delay in payment. The study also sheds light on the practical problems associated with deferred sales, such as the issue of increasing the price in exchange for deferral and distinguishing it from usurious sales. It also demonstrates that price increases in deferred sales are legally permissible if they result from mutual consent and are economically justified and are not conditional on interest payments for the deferral.

The study concludes that deferred sales are a legitimate and effective system for supporting the economic cycle. However, it requires more detailed legislative regulation in positive laws to ensure a balance between the interests of both parties and prevent arbitrary implementation or failure to fulfil obligations, especially in cases of default or changing economic circumstances